World Report

Miranghe Pela
Managing Director of TAG&E;

‘We expect to grow at more than 200 per cent annually over the next three years’

rans Africa Gas & Electric Corporation (TAG&E) is one of a new breed of independent power companies in Nigeria, locally-based and intent on bolstering energy provision in the West African state.
Power sector development is one of the chief priorities of President Obasanjo’s regime, underlined by the recent transformation in the structure of the electricity supply.

Trans Africa Gas & Electric has big expansion plans. The company is looking to develop up to 15 power generating plants throughout the country by 2010. It specialises in smaller, off-grid, captive power plants selling energy to private off-takers and companies. This year alone, there are plans to spend around $28 million (£15.5 million) to start building five of these proposed new facilities.

Managing Director Miranghe Pela says the government’s initiative to bring in large-scale producers is the right way forward, though in the near term there remains a requirement for smaller, isolated off-grid power islands supplying reliable energy to individual consumers. “We went to industrial companies because they were the major power off-takers, and we installed our turbines and generators,” he says. “This gave us the opportunity to increase capacity and distribute to the surrounding areas.”

Trans Africa Gas & Electric has already come a long way. Formed in 1999 as a subsidiary venture of Phillips Enterprises of the United States, it is now an independent entity in its own right. It currently has two plants in operation – one a bio-fuel operation, the other a full gas engine – generating around 1.5 megawatts.

Another key element of its strategy is bringing natural gas into play for power generation to offset expensive diesel generation. Though the initial outlay for a gas generator can be more expensive, the fuel savings more than offset the difference.

The company certainly has considerable technical depth and is backed by strong international alliances with the likes of General Electric.

It is keen to identify suitable financiers to help back its planned expansion drive. This could take the form of joint ventures, equity financing, or other methods.

Pela says talks have started with various international partners and he is keen to talk to interested UK players. The sheer scale of the Nigerian market highlights the clear potential for power sector investors in the coming decade.

“Today, we are at an embryonic stage. I believe this will continue for the next three years – we expect to grow at more than 200 per cent annually. As long as the finance is there we will achieve that feat. The market is there, the opportunities are there.”